Out of bounds? Playing ball with celebrity right of publicity and fair use

A spate of recent lawsuits has left companies questioning the difference between commercial and non-commercial speech. Several highlight the dangers of stepping out of legal boundaries, wittingly or no, when engaged in commercializing businesses using advertising and social media. Two recent cases show how difficult it is to determine what constitutes commercial use (thus potentially infringing use) and non-commercial use (and thus fair use) of a celebrity’s identity.

Individuals are generally considered to consist of two types of personality rights. One is the right of publicity, which allows the individual to keep her or his image and likeness from being commercially exploited without permission or contractual compensation. In this regard, the right to publicity is similar to the use of a trademark. The other is the right to privacy — that is, the right to be left alone and not have one's personality represented publicly without permission.

Like all of us, celebrities such as Michael Jordan and Katherine Heigl have both of these rights. They have a personal right to privacy — often threatened by paparazzi or just by curious onlookers. And they have the right of publicity, allowing them to control the commercial use of their respective names, images or likenesses, or the other unequivocal aspects of their own identities. Generally considered a property right as opposed to a personal right, the validity of an individual's right of publicity can survive his or her death (though to varying degrees depending on the jurisdiction).

The right of publicity can be violated when a company uses a celebrity’s name or likeness for advertising purposes without permission. The right of publicity is not violated, however, if the celebrity’s name or likeness is used in a non-commercial way, because that type of use is protected by the First Amendment.

The first alleged personal foul was called by basketball superstar Michael Jordan, who is engaged in a right of publicity dispute with Jewel Food Stores, Inc., a Chicago supermarket operator that goes to market under the Jewel/Osco banner. When Jordan was inducted into the Basketball Hall of Fame in September 2009, Sports Illustrated produced a special commemorative issue devoted exclusively to Jordan’s career. Within it, Jewel ran a full-page advertisement congratulating Jordan on his induction.

Jordan did not view Jewel's advertisement as an innocent celebratory gesture. He saw it as a misappropriation of his identity for the supermarket chain’s commercial benefit. He sued Jewel, arguing that the supermarket chain's advertisement was an instance of standard commercial speech, which gets reduced constitutional protection, and a violation of his right of publicity. In its defense, Jewel argued that its advertisement was non-commercial speech and thus enjoyed full First Amendment protection.

This disagreement is the crux of the dispute. If the advertisement were classified as commercial speech, then it may be regulated, normal liability rules apply, and the court battle moves to the merits of Jordan’s claims. If the advertisement were fully protected as non-commercial speech, then the court would have rule that the First Amendment provides a complete defense and Jordan's claims could not proceed.

Up and down the courts they went: The district court held that it was fully protected non-commercial speech and entered judgment for Jewel, and then the 7th Circuit reversed. The 7th Circuit began its opinion by noting that the textual focus of the advertisement was a congratulatory salute to Jordan on his induction into the Hall of Fame. Nonetheless, it decided that Jewel's advertisement was commercial speech because it served the dual purpose of also promoting its supermarkets. In holding for Jordan, the 7th Circuit explained that the advertisement prominently featured the “Jewel-Osco” logo and marketing slogan, which were conspicuously linked to Jordan in the text of the congratulatory message.

Based on this, the 7th Circuit held that Jewel's advertisement was properly classified as a form of image advertising aimed at promoting the company's brand, and as such was commercial speech subject to the question of whether it improperly suggested a connection, association or endorsement by Michael Jordan of Jewel. Because the lower court had never reached that part of the analysis, the 7th Circuit remanded the case to the district court to analyze that issue.

While Jordan continues to dribble up and down the courts on Jewel, actress Katherine Heigl is hoping to score against New York-based Duane Reade pharmacy.

Heigl was photographed in March near a Duane Reade store in New York by local paparazzi. Duane Reade's marketing department secured the photograph, and then posted it on Twitter and its Facebook account with captions advertising the store. The tweet in question read, “Love a quick #DuaneReade run? Even @KatieHeigl can't resist shopping #NYC's favorite drugstore.”

That’s when Heigl called a foul: Duane Reade didn’t have the actress’s approval to use her image. She filed a $6 million civil lawsuit against Duane Reade — now owned by the national pharmacy Walgreen Co. — for using her name and an unauthorized photograph of her in its commercial advertising.

As with Jordan, at the heart of Heigl’s complaint is her right of publicity. She argues that the she is highly selective and well compensated when she chooses to endorse a product or service and, in this case, she did not authorize Duane Reade to use her name, picture or image. She also goes further to try to push Duane Reade’s tweet outside the non-commercial/First Amendment safe zone by explaining that Duane Reade’s Twitter account normally includes only occasional Duane Reade products or store premises photographs displayed as the user scrolls through the Tweet postings. Among recent photographs, protests her complaint, Ms. Heigl’s image stands out as the only celebrity image. Therefore, she claims, the pharmacy designed to exploit Ms. Heigl’s image to garner cachet for Duane Reade’s Twitter page, and to imply that Ms. Heigl endorses Duane Reade.

Duane Reade has not yet answered the complaint. If it does, it may well argue, similarly to Jewel, that its tweet was non-commercial speech. As a fallback, it might argue that even if its tweet is deemed commercial speech, Duane Reade’s consumers would not mistakenly believe that Ms. Heigl endorses, sponsors, or approves of Duane Reade.

However Ms. Heigl’s complaint is decided, right-to-publicity lawsuits demonstrate why brands need to be extremely careful when using celebrities’ images without their permission in ways that could be interpreted to promote corporate goals. For example, those enthusiastic employees staffing corporate Twitter feeds and social media accounts have the challenging task of quickly coming up with engaging, on-brand social media content while also staying within the limits of the law. When it comes to social media, what is legal and fair use and what is not can be murky.

These lawsuits are the early ones. We can expect many more will cause courts to take a serious look at how brands use celebrities’ images in their advertising. Being informed about these issues could save your company from stepping out of bounds — getting beaten in court or on it.